The following is a statement of Barbara Fiorito, Chair of the Board of Directors, Oxfam America:
Oxfam supports the Rural America Preservation Act as a step toward long-overdue reform of the US agricultural subsidy program. The US Congress must move swiftly to enact agricultural commodity payment caps to help direct assistance to the neediest farmers here and to make policies fair to farmers abroad.
Oxfam is concerned about people in need, whether they are recovering from a tsunami or struggling to make a living through their own hard work. Oxfam is committed to ending poverty, hunger and injustice using a variety of methods including humanitarian relief, development programs and campaigning for policy change. Increasingly, we see parallels between the plight of poor farmers and rural sectors at home and those we work with abroad.
Agriculture has the potential to grow economies and lift tens of millions out of poverty, but the current agricultural subsidy system is broken. Farm programs in the US exclude most farmers and disproportionably benefit the largest producers. Despite decades of farm program payments, economic researchers have been unable to establish that these payments help sustain farm-based communities.
The US government spends up to 16 billion dollars a year on farm payments that are heavily concentrated in large-scale commercial operations. Over 70 percent of the money goes to the top 10 percent of farms receiving government support. At the same time, many small-scale family farmers get little or no support. Although subsidies were originally created to help poor farmers during the depression era, they do an awfully poor job of helping America's family farmers today. Taxpayer funds would be better used to support development in rural America, addressing poverty, and targeting the underprivileged farmers that really need help.
Loopholes in the current rules allow the largest farms to collect enormous subsidies, which can exceed $1 million. Handouts to corporate farms lead to overproduction, with the surplus dumped on international markets at prices below production costs. Crop prices are driven down, threatening the livelihood of family farmers across the world.
Approximately 1.3 billion people in the world live on less than $1 a day; more than two-thirds of them depend on farming to make a living. One example of the impact of US overproduction and subsequent dumping on global markets is the loss of almost $400 million for poor cotton-producing African countries between 2001 and 2003. On current price trends Mali could face a deficit on cotton revenues of up to 70 billion FCFA (nearly US $150 million) in the coming year.
The current system is broken and is harming farmers both here and abroad. Oxfam strongly supports the Rural America Preservation Act to reform farm programs to make agriculture more fair and a better livelihood.